The Central area on the island is the historical, political and economic centre of Hong Kong. The northern coast of the island forms the southern shore of the Victoria Harbour, which is largely responsible for the development of Hong Kong due to its deep waters favoured by large trade ships.

The island is home to many of the most famous sights in Hong Kong, such as "The Peak", Ocean Park, many historical sites and various large shopping centres. The mountain ranges across the island are also famous for hiking. The northern part of Hong Kong Island, together with Kowloon and Tsuen Wan New Town, forms the core urban area of Hong Kong. Their combined area is approximately 88.3 square kilometres (34.1 square miles) and their combined population (that of the northern part of the island and of Kowloon) is approximately 3,156,500, reflecting a population density of 35,700/km² (91,500/sq. mi.).

The island is often referred to locally as "Hong Kong side" or "Island side". This style was formerly applied to many locations (e.g. 'China-side' or even 'Kowloon Walled City-side') but is now only heard in this form and 'Kowloon side', suggesting the two sides of the harbour.[2] The form was once more common in Britain than now, such as 'Surrey-side'[3] and is still seen in British placenames like 'Cheapside', 'Tyneside', and 'Teesside', not all of which have an obvious watercourse or boundary with actual sides.

Hong Kong island became a colony of the British Empire when their forces defeated the Chinese in the First Opium War (1839-1842). The island was populated by only a few thousand people when British empire colonized it, and was thus described as being almost uninhabited.

On 18 December, the Japanese had conquered North Point, reaching Wong Nai Chung Gap on the next day. English and Scottish forces and the Canadian Winnipeg Grenadiers vigorously defended the crucial point of Wong Nai Chung Gap, and for a while successfully secured the passage between Central and the secluded southern parts of the island. Japanese casualties were about 600. However, Allied forces there were ultimately defeated by the Japanese on 23 December, and Wong Nai Chung Reservoir was lost – the only one in Hong Kong at the time. As Wan Chai Gap had also fallen that same day, the British had no choice but to surrender.

Hong Kong was surrendered on 25 December 1941, thereafter often called "Black Christmas" by locals. The Governor of Hong Kong, Mark Young, surrendered in person at the temporary Japanese headquarters, on the third floor of the Peninsula Hotel, thus beginning the Japanese occupation of Hong Kong. Isogai Rensuke became the first Japanese governor of Hong Kong. Hyper-inflation and food rationing followed; and the Japanese declared Hong Kong Dollars illegal. The Japanese enforced a repatriation policy throughout the period of occupation because of the scarcity of food and the possible counter-attack of the Allies. As a result, the unemployed were deported to the Mainland, and the population of Hong Kong had dwindled from 1.6 million in 1941 to 600,000 in 1945.[4]

The population as of 2011[update] is 1,270,876, which makes up approximately 19% of that of Hong Kong. Its population density is higher than for the whole of Hong Kong, ca. 18,000 per km². However, the population is heavily concentrated along the northern shore. The combined population of Central and Western, Wan Chai, and Eastern is 1,085,500, giving this urbanised part of the island a density of around 26,000 per km², or 67,000 per mi², in its approximately 41.3 km2 (15.9 sq mi).

South Island Line (East) is under construction which will provide metro service from Admiralty to Ap Lei Chau via Wong Chuk Hang. This line is expected to inaugurate in 2016 and relieve the congested Aberdeen Tunnel during rush hour. North South Corridor, the southward extension of the East Rail Line will also terminate at Admiralty and stop by the Hong Kong Convention and Exhibition Centre before leaving the island, providing direct metro service to the Hong Kong–Shenzhen border checkpoints. This line is tentatively expected to open in 2021. North Island Line is planned to extend Tung Chung Line and Tseung Kwan O Line to be met at Tamar Station. The majority of the extended sections will be situated beneath the reclaimed land of the northern coastline of the island. The project is aimed at sharing the load of the already busy Island Line, but it will not begin construction before 2020.